E32012 came and gone. One of the biggest post-E3 news was none other than OUYA, a digital-only gaming console coming out. It was announced on July 3rd, 2012, and has gone to become one of the most-talked, most-backed KickStarter projects yet. If you’ve never heard of OUYA, check out the trailer they released alongside the announcement.

Hmmm. Looks good, what’s the problem?
OUYA has been rising in popularity, but it’s not without it’s own controversy. Some think that OUYA does not have what it takes to be as big as corporate gaming giants like Nintendo, Sony, and Microsoft. One writer even speculated that OUYA may be dead on arrival. So, I was reading my e-mail the other day, and I discovered the AngelList page for OUYA. The interesting thing about the listing is the enormous amount of people with experience.

Why should I care? What does this have to do with “we have it all wrong about OUYA?”
Well, AngelList is a Silicon Valley-backed social platform for start-ups to connect with Venture Capitalists in their respective areas. This is significant because those who add their weight to the startup are actually raising their papers saying “I did this. Fund us!” The other thing of note, is the list of team members, and advisors.

Julie Uhrman is the founder and C.E.O. of OUYA. What’s interesting is that she was the former head of IGN’s digital distribution division. And the referrer of the project is none other than Roy Bahat, who is currently the president of IGN. Why am I bringing this up?

Well, a lot of companies as of late have been trying to jump into the digital distribution game for years now. Xbox Live led this charge when it launched Xbox Live Arcade, and Xbox Live Marketplace in 2004 and 2005 respectively. Sony followed suit by launching PlayStation Store in 2006. Nintendo also launched Virtual Console in 2006. The list keeps expanding to PC’s, even though they’ve dabbled with PC downloads for years. Steam led this charge for quite a while, until GameStop and Electronic Arts decide “that’s it, we’re going in.”

Recently, Electronic Arts has made it clear, that their company is changing from a brick and mortar video game publisher, to an all digital distribution company. [source] Electronic Arts launched their own content delivery website, Origins. This came following Activision’s announcement of Call of Duty Elite which is also a content delivery service aimed at Call of Duty players with their subscription model that released alongside Call of Duty: MW3.

You think it stops there? Nope. GameStop partnered with a few companies intent to enter the digital distribution game. [One source] What’s more interesting is that GameStop and IGN are partners. [source] IGN has dabbled with digital distribution in the past, too. [source] That was in 2004, since then, Direct2Drive has been sold to GameFly. [source] GameFly buys, sells, and rents games to customers worldwide, and they’re looking to join this digital distribution game, too. Obviously.

Still think this is done? No. Far from it. Cloud Gaming is also on the rise: In 2010, OnLive was released to the world. The following year, Gaikai was launched, and just most recently, Gaikai was acquired by Sony. [source] Each service has a form of digital distribution.

So, as you can see.. Not only OUYA connected through IGN, it’s got advisory from the former Co Founder of the Xbox project. You also now understand that digital distribution is getting really crowded at this point. Each company is vying for the top spot as the leader in digital delivery. While some companies are trying to gain their own digital distribution pie, each service serves a purpose for each company.

Okay, so you’re saying that OUYA will be successful?
More or less, yes. Thing is, IGN is a huge video game news organization. They stand to gain from their early advisory of OUYA than any one name that’s listed on AngelList. OUYA didn’t really need KickStarter in the first place. Rather, what OUYA is trying to prove to other companies, most notably, IGN – that a new console is able to compete in the ever-so-competitive marketplace that is the video game industry.

I have a feeling that OUYA will be acquired by IGN at some point since they want to get into the digital distribution game. Another obvious company that may be interested in OUYA, is none other than Google.

Uh. Really? I guess PlayStation 3, Xbox 360, and Wii type of console will just die in the next few years then.
On the contrary. I strongly believe that the brick and mortar game consoles will live as long as companies like Sony, Nintendo, and Microsoft continue supporting it. OUYA is designed as an open source console, a digital-only console, and I don’t think that OUYA’s direct competition is the three console kings. Actually, I believe that OUYA is targeting it’s crosshairs squarely at OnLive. Or whatever Apple is launching next.

Apple, what? Why are they involved?
For a while now, Apple has been experimenting with mobile gaming for quite some time, and this experiment expanded to ipad. Apple has been impressed with the marketshare for gaming on iphone, ipod, and ipad. With this, Apple intends to enter the game industry. And they have the technology to enter the digital distribution game. I wrote an article related to this a while ago.

Can OUYA survive the industry?
Depends on how you look at it. All OUYA needs is an investor powerful enough to take OUYA to market success. It also needs more indie developer support than anything. In this economic downturn, innovation is required to take an industry into the right direction. It’s getting support from the likes of Robert Bowling, the creative leader of the smash hit, Modern Warfare. It’s also getting praise from publications such as Engadget, PC World, Gamasutra, Kotaku, GameSpot, The Verge, Time, New York Times, and of course, IGN. A lot of developers are also singing praises for OUYA.

But it depends on what you, the consumers, the customers want. It depends on how you look at it. I’m all for a cheap game console, but I’ll stick to my PlayStation 3…